Bought out our Nissan Lease - VERY difficult!

[DuckRyder]

A lease is a rental agreement. So if you leased a car 35 mos., and decide to buy it out at the end, as the lessor, I would sell you the car for whatever it's worth full retail, used. Your lease payments do not reduce that amount. I'm not doing any favors, I'm in the business to maximize my profits. I can't give you my asset for less than I can get on the open market, at a given point in time.

In other words, say the car is worth $16,000 wholesale, and $24,000 retail. Your buyout is $24,000.

I have never seen a lease that did not have a pre-set Residual value, that is the buyout at the end. Yes typically there are penalties for early buy out but at lease end the residual should be what you pay. I don't know how you would calculate lease payments without a pre set residual.

 

[hrv]

Going to the dealer was your big mistake. They don't own the car, the finance company does, either Nissan's or yours. No need to deal with anyone else but them.

My Honda dealer tried the same shenanigans when we wanted to buy our leased Civic. The sales rep told us it would cost over $2000 just in inspection and handling fees because they needed to get it back first for some (really no) reason. It was all BS.

After doing some research we went directly to Honda Finance and they just told us we just owed the agreed-upon value of the car when we signed the lease... and that was it. It really felt like we were doing something wrong because it was so easy after the dealer made it seem like it was this long complicated process when all it was was an opportunity to fleece us out of more money.

I had a lease once with Honda and if you want to keep it the dealer has nothing to do with that. Honda Finance does it and I had no problems with them at all..

 

[JeffKeryk]

Can someone explain this to me like I'm 6 years old.

A lease is a rental agreement. So if you leased a car 35 mos., and decide to buy it out at the end, as the lessor, I would sell you the car for whatever it's worth full retail, used. Your lease payments do not reduce that amount. I'm not doing any favors, I'm in the business to maximize my profits. I can't give you my asset for less than I can get on the open market, at a given point in time.

In other words, say the car is worth $16,000 wholesale, and $24,000 retail. Your buyout is $24,000.

To break the rental agreement early, that's all profit I'm missing out on, why would I allow it?

I've never leased a car, and never will. But maybe I'm stubborn, this means driving a 2006, 2007, and 2011 today, in 2023. Sure I'd rather have a 2024. The car I like is $81,000, and it's a Chevy (not even a Corvette). I looked at my finances and said I should put $50,000 down. But I know I wouldn't do that. Likely only $30k. Leasing would make a monthly payment look much better, I know.

Lease agreements typically (always?) include the buyout option price. I leased a Lexus RX450h and turned it in on a new F Sport model. The dealership gave me about $3000 credit towards the purchase of the new RX. They told me our car would not last the weekend on their lot.

 

[Dave P.]

We, my daughter and I, found out the hard way too. The dealer, who is so buddy-buddy when you lease the vehicle, did nothing to assist her when she tried to purchase it. It was our first time buying our leased vehicle so we didn't know anything and started with the dealer thinking that was the logical place. MISTAKE! No help at all. Finally figured out the dealer didn't need to be part of the process and then the rest was easy. Straight to the finance company, pay the buyout figure, done.

 

[John105]

Lease agreements typically (always?) include the buyout option price. I leased a Lexus RX450h and turned it in on a new F Sport model. The dealership gave me about $3000 credit towards the purchase of the new RX. They told me our car would not last the weekend on their lot.

That buyout price, how accurate are they in predicting the future so that the house wins?

I'm thinking that if a lease started 2018, and ended 2021, it may have been written such that the lessor didn't predict the explosion of used car pricing. But a lease written 2022-23, they would.

In other words, I'm 6 years old. A young 22 college graduate asks Suze Orman, my friends tell me I should lease a car. Should I?

Suze tells the nice young girl, you need new friends. Why is Suze incorrect?

What I'm driving at is I've had coworkers claim leasing then buying is cheaper than buying. And as a 6 yo., that doesn't pass muster. Money is never free, nor are opportunities.

 

[Hall]

A lease is a rental agreement. So if you leased a car 35 mos., and decide to buy it out at the end, as the lessor, I would sell you the car for whatever it's worth full retail, used.

No, the current retail value is irrelevant. When you lease a car, in simple terms, it goes something like this:

Sale price - residual (expected or anticipated) value at end of term / number of months of lease

Just using round numbers, it could look like this: $30,000 - $21,500 / 36 = $236/month lease payment

That buyout price, how accurate are they in predicting the future so that the house wins?

Sometimes they are, sometimes they aren't. In recent years, it's been an anomaly. Retail prices were (much) higher than they anticipated but the lease agreement was already done and signed so they couldn't change it. This is exactly why people were able to sell the leased vehicle outright themselves above the residual value, pay off that amount, and pocket the difference.

 

[ThirdeYe]

Going to the dealer was your big mistake. They don't own the car, the finance company does, either Nissan's or yours. No need to deal with anyone else but them.

My Honda dealer tried the same shenanigans when we wanted to buy our leased Civic. The sales rep told us it would cost over $2000 just in inspection and handling fees because they needed to get it back first for some (really no) reason. It was all BS.

After doing some research we went directly to Honda Finance and they just told us we just owed the agreed-upon value of the car when we signed the lease... and that was it. It really felt like we were doing something wrong because it was so easy after the dealer made it seem like it was this long complicated process when all it was was an opportunity to fleece us out of more money.

That's good to know, I always assumed you had to get the dealer involved. My grandma bought her 2015 Civic off-lease since it only had around 12,000 miles on it at the time, and the dealership charged around $1000 in paperwork fees. I assumed it was normal. Noted for the future... (I own the Civic now, great little car!)

 

[eljefino]

Was thinking WTH is a Grandma Keith then I looked at your fleet.

That's what Mike Tyson calls it.

 

[Hall]

I always assumed you had to get the dealer involved

Dealers have almost nothing to do with leases except for processing "paperwork". The lease is between the leasing company (not the dealer) and you.

 

[ls973800]

Buying your end of lease vehicle is the same as buying a used car or truck. Some states require a seller to have a dealer's license in order to sell the vehicle and some states don't. Many lease holders such as Honda or Toyota may not be licensed in every state to sell a vehicle so you are stuck going to a dealer to buy it. The dealer than adds their "fees" such as inspection, doc fees, etc since they are just the middle man providing the legal requirements of being licensed to sell vehicles. Since they are the ones selling the vehicle they sometimes add the large "inspection" fees since they are the ones on the hook if they were to sell an unsafe vehicle and they are not making any money off the sale itself usually unless they add the other fees or do the financing.

 

[CKN]

Everything You Need to Know If You're Considering a Nissan Lease Buyout

Learn about the Nissan lease buyout process to determine if it's worth it.

www.caranddriver.com